On December 7, 2017, the Ontario Superior Court released its
reasons for decision in Wagner v. Fellows,
2017 ONSC 6979. The action arose from a single-vehicle accident that took place
early in the morning on April 2, 2011. The defendant, 16-year old Madison
Fellows, was operating a van owned by his mother, Melissa Ley, when he lost
control of the van and crashed. The plaintiff, 15-year old Tyler Wagner, was a
passenger in the van along with another youth, 13-year old "M.F."

The plaintiff commenced an action against Ms. Ley alleging
that she had expressly or implicitly consented to her son's possession of her
van at the time of the accident, rendering her vicariously liable pursuant to
section 192(2) of the Highway Traffic
Act. The plaintiff further alleged that Ms. Ley was independently negligent
in the way she kept and controlled access to the van's keys, following the case
of J.J. v. C.C., 2016 ONCA 718, in
which the Court of Appeal upheld a 37% liability finding against an auto body
shop for failing to exercise due care in the storage of cars and car keys.

In this case, Mr. Fellows attended a party on the evening of
April 1, 2015 and met the plaintiff there. A few hours later, Mr. Fellows
walked home and took the van while his mother slept. Mr. Fellows picked the
plaintiff up at his home and together they picked up two 13-year old girls,
N.F. and M.F. The group drove from Keswick to Newmarket and back, then dropped
N.F. off at her home. They then drove to Sutton. On their way back to Keswick,
Mr. Fellows fell asleep at the wheel and crashed the van in a ditch.

Court Decision

Vicarious liability
and independent negligence

The Court found that Mr. Fellows, who had obtained a G-1
learner's permit two or three months before the accident, had taken the van on
eight to ten previous occasions while his mother was sleeping. Both Mr. Fellows
and his mother independently testified that the keys to the van were always in
her purse, and that the purse was always with her. Mr. Fellows and his mother
also agreed that she kept the purse either in bed with her or on the floor
beside the bed at night. Mr. Fellows testified that he would enter the bedroom
between midnight and 6 a.m., while his mother "slept like the dead,"
and take the keys from her purse for a nighttime "joyride."

Mr. Fellows further testified that his mother did not give
him consent to possess her van, and the Court accepted Mr. Fellows' assessment
that his mother was generally unaware of his excursions. Mr. Fellows took steps
to avoid getting caught taking the van.

Both Mr. Fellows and his mother independently described one
occasion on which she became suspicious after seeing that a booster seat had
been moved in the van. She confronted Mr. Fellows, but he lied and was able to
partially deflect her suspicions.

Ultimately, the Court accepted that Mr. Fellows knew that
his mother did not consent to his possession of the van on the night of the
accident and that, therefore, Ms. Ley was not vicariously liable for his
negligent operation of the van pursuant to section 192(2) of the Highway Traffic Act.

The Court similarly found that Ms. Ley was not independently
negligent in controlling the keys to her van. While "Mr. Fellows was no
angel" and did not always listen to his mother, who "tried to keep
the peace for the sake of the other two children," the Court found that
Ms. Ley did confront Mr. Fellows when Ms. Ley suspected that her van had been
taken. Ultimately, the Court found that:

A reasonable parent acting reasonably is to be expected to
take a graduated approach to discipline and security. The risk adolescents pose
is not readily predictable. As it was, Ms. Ley probably exceeded the standards
of most by invariably keeping her car keys in her purse and under her nose.

Payment of AB funds
not admission

The plaintiff had also made a claim against Ms. Ley's
insurer for uninsured motorist coverage. In its defence, the insurer relied
upon an exclusion contained in section 1.8.2 of the standard Ontario Automobile
Policy (the "OAP 1") which states that a passenger is not entitled to
coverage if he willingly becomes an occupant of the vehicle when he knew or
ought reasonably have known that it was in the driver's possession without the
owner's consent.

At the outset of trial, the plaintiff and the Motor Vehicle
Accident Claims Fund (the "Fund") moved for a declaration that the
insurer could not rely on this defence because the insurer had paid non-earner
statutory accident benefits in settling the accident benefits claim. They
argued that the insurer's would not have been required to pay those benefits if
the exclusion was found to apply and so the payment and settlement constituted
an abuse of process or, alternatively, an admission that the exclusion did not
apply. In its decision reported at 2017 ONSC 6979, the Court reviewed the
accident benefits ("AB") settlement documents and noted that the Full
and Final Release specified that the AB settlement was without admission of
liability. The Court further noted that there was no proceeding or decision on
the merits of the AB claim and so there was no abuse of process.

Significance of the Decision

This case illustrates that a vehicle owner may
successfully defend against a finding of vicarious and independent liability
from the unauthorized possession of their vehicle even where they may suspect
that a member of their household has previously taken that vehicle. However, in
order for the defence counsel to succeed, it is vital to have candid and
credible evidence on the core issues of a vehicle owner's measures to control
their vehicle and communicate and enforce their rules regarding vehicle use.

The views expressed in this document are solely the views of the author and not Martindale-Hubbell. This document is intended for informational purposes only and is not legal advice or a substitute for consultation with a licensed legal professional in a particular case or circumstance.

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